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The financial report holds important information and data regarding the decisions made and policies undertaken driven by the financial goals of the company. The relevant data obtained from cash flow and fund flow are important tools for shareholders and investors. This is because they provide useful insight into the overall performance of the company. Cash equivalents and also actual cash flow is recorded in the cash flow. Fund flow essentially records the movement of funds or cash into the company or out of the company. These are tools used to provide periodic insights into the financial health of a company.
Difference between Cash Flow and Fund Flow
Cash flow and fund flow are part of the financial report maintained by companies. Cash equivalents and also actual cash flow is recorded in the cash flow. Fund flow essentially records the movement of funds or cash into the company or out of the company. The difference between cash and fund flows is in particularity. Both cash and fund flows are statements in a financial statement or record maintained by a company. Cashflows denote the movement of cash as it is received and spent by the company. Fund flows are the recorded changes in a company’s financial or working capital. Fund flows are calculated over two years.
The difference between cash flow and fund flow is:
Cash Flow | Fund Flow |
Cash flow is the statement that records outflows and inflows of cash received and spent by the company | Fund flow is the statement that records changes in the capital during a certain period |
Accounting is based on cash | Accounting is based on accrual |
Cash flow is an element of a financial statement | Fund flow is not a part of a financial statement |
Cash flow is essential in cash budgeting | Fund flow is an important part of capital budgeting |
Reveals the financial position of an organisation | Reveals the net flow cash |
These are important to complete a financial company report | This can be created internally |
Performs liquidity analysis | Working capital analysis |
Cash equivalents and also actual cash flow is recorded in the cash flow. Fund flow essentially records the movement of funds or cash into the company or out of the company. The relevant data obtained from cash flow and fund flow are important tools for shareholders and investors. This is because they provide useful insight into the overall performance of the company.
Cash Flow
Cash flow is an element of a financial statement. Cash flow is the statement that records outflows and inflows of cash received and spent by the company. These are important to complete a financial company report. Cashflows denote the movement of cash as it is received and spent by the company. Includes three particular sections:
- Investing
- Operating
- Financing
Fund Flow
Fund flow is the statement that records changes in the capital during a certain period. Fund flows are the recorded changes in a company’s financial or working capital, calculated internally. Fund flows are calculated over two years. The fund flow includes the following sections:
- Sources
- Applications
Conclusion
Cash flow and fund flow together give a valuable overview of different aspects of a company and how it is performing. It also provides a good basis of evaluation for investors who can assess its financial position and decide whether to invest or buy shares of that company. The financial report holds important information and data regarding the decisions made and policies undertaken driven by the financial goals of the company.
